Copper is one of the earliest metals that humans extracted and used. Indeed, it was the most abundant metal and the easiest to extract since it was deposited at the surface of the ground. Since then, it has been used to manufacture various work tools, to create decorative items, and also works of art.
Various uses of copper
Copper is found in a variety of applications, notably in the manufacture of roofing, electrical wires and industrial machinery. Furthermore, copper has a fairly high hardness, which means it is often combined with other elements such as bronze or brass.
Copper is also used in the agricultural sector to create compounds for nutritional supplements and fungicides. Finally, it has been used in the manufacture of building coverings since ancient times.
To obtain fairly complex parts with good machinability, copper should be combined with other alloys.
Chile: leading copper producer
While Chile alone produces more than 34% of the world’s copper production and positions itself as the leader in the field, China, for its part, is the top importer of copper, accounting for more than 28% of global imports.
During the first quarter of 2009, Chinese demand recorded a strong increase of more than 43% while demand from the rest of the world showed a decline of 18% over the same period.
Since then, China has been managing global copper production and its imports have, since 2009, experienced an unparalleled rise. This is, moreover, what helped drive the current surge in the copper price. Furthermore, this implies that if China suddenly curtails the supply of credit in order to stabilize its economy, then the copper price risks experiencing an unprecedented collapse. As a reminder, at the end of January 2009, the price fell by more than 14% in a few days.
The current price and market value of copper
In recent years, the price of copper has experienced an unparalleled rise. Two years earlier, copper was sold at 4 euros per kilogram and up, depending on the quality of the metal offered. The price of copper on May 4, 2012, for its part, recorded a decrease of 0.25% to reach $8,295.50 (€10,856)/tonne.
Moreover, industry specialists have noted that the price of copper has proven more volatile than stock prices and the economy in general. Even in moments when the collapse of the copper price was followed by sharp drops in industrial production or in stock prices, these were nonetheless moderate.
If we take the situation of the second quarter of 2004, for example, we note that the price of copper recorded a decline of more than 11.4% while stock prices fell by only 2.3%. As for industrial production, it recorded a slight increase.
In short, the copper market has its ups and downs; however, it remains a profitable and interesting material that many industrial players still vie for today.